According to data released by the California Air Resources Board, CARB, Tesla Motors was the top seller of the zero-emission vehicle credits that regulatory board requires car makers to have if they want to sell cars in that state. Toyota was the top seller of hybrid-car credits.

Tesla sold 1,311.52 ZEV credits from Oct. 1, 2012, through Sept. 30 this year. Suzuki Motor Corp., the next biggest seller, transferred about 41 credits. Though Suzuki no longer sells cars in the United States, they still have credits accumulated from prior sales. Toyota transferred 507.5 plug in zero emission vehicle credits generated by its Prius hybrid. General Motors Co. acquired the same number as Toyota sold, so presumably GM bought them from its Japanese rival.

Buyers of CARB ZEV credits.

Automakers, if they want to sell cars and light trucks in California, must sell EVs or other zero emissions vehicles in proportion to their market share in the state. The goal is to have a million and a half ZEVs on California roads by the year 2025. If companies generate more credits than their sales require, CARB allows those credits to be sold. Each Tesla Model S earns the company as many as 7 ZEV credits, the maximum issued by California.

Companies listed by CARB as buying ZEV credits over the past 12 months were Chrysler Group LLC, GM; Honda Motor Co.; Jaguar Land Rover; Fuji Heavy Industries Ltd.’s Subaru; and Volkswagen AG. CARB does not keep track of specific trades or prices, saying the goal is for all automakers covered under California law are compliant.

Some indication of the pricing can be found in company financial reports. Tesla reported that 12% of it’s revenue in the first six months of 2013 came from ZEV credit sales amounting to $119 million. Tesla CEO Elon Musk said that the company’s ZEV credit sales will decline in the second half of the year.

That’s what I was thinking, what if everyone was a seller of credits, who would buy?

But then I’m thinking about it in the same distorted reality that they have placed the playing field.

Whatever, if the laws stay, then the economy will suffer, and people will move elsewhere, then maybe automakers will just drop California all together.
Either they going to pay billions to create a net loser
Spend billions to prop net losers
Or get out all together.

For this to happen, every mfr would have to be selling enough ZEVs to exceed CARB’s reqs, a highly unlikely situation in a state where exotic and luxury ICE cars are very popular. But before conditions got close to that state the ZEV credit market would adjust, either thru the mfrs changing their product mix or thru CARB changing their reqs.

Either way the automakers will get punished for the “evil deeds” they do.

Doesn’t this also in effect reduce competition? Low volume producers are forced join into other companies or die. Rolls Royce could not survive in such a market without BMW.
Would a good plan of action be for all automakers to team together to create a single design and then just rebrand and name for each company? Wouldn’t have to worry about each automaker individually wasting its own resources.

What would happen if all the automakers on the transferee list announced that they were not going to pay tribute to the econazis and suspended all new car sales in California? Lay off all salespeople (keep service departments open) or sell used cars only, and wait for the backlash from the carbuying public and unemployed salespeople to reach Sacramento.

Wouldn’t that be nice jpolicke? Instead, the automakers just pass their additional costs on. All so that Elon can make millions, the financially successful can roll around in ecochic-mobiles, and the wise Mandarins in Sacramento can keep playing SimState.

Because there are 12 or 13 states that all subscribe to CARB laws. California was the progenitor, but is far from the only participant now. That means mfrs would have to forego sales in more than 20% of states, and due to the participating state populations, likely 30+ percent of the nation’s car buying public. My guess is it’s cheaper to buy the credits and still sell cars, rather than forego revenue. Opportunity cost outweighs the benefit.

Much like how manufacturers have been building and allocating special PZEV and LEV edition vehicles to carb states for the last several years. Some of the cars mfrs ship to CA, MA, NY, etc have a different emissions system/tuning than those shipped to Montana for instance. At least until the OEMs meet their required PZEV/LEV quota in CARB states.

This is also why some mfrs have stopped pushing back against CARB and are actually in favor of a wider reaching CAFE… It’s actually cost beneficial to seek one federal standard which removes the onerous and expensive state level requirements.

While some states have adopted CARB standards it is usually just the emissions level requirements and not the whole mess. I know my state adopted the basic emissions standards but not the CARB specific emissions durability warranty which is really stupid. We also do not have a ZEV mandate.

I still say the whole idea of selling these “credits” is total fraud. If they put a quota on automaker sales unless they sold X amount of low pollution vehicles I may disagree with but it would force everyone to develop of license PZEV or ZEV tech. Using this method I could flood Cali with 12mpg high smog wonders and if my margin was high enough transfer a percentage of profit to someone with a golf cart division (i.e. GEM).

No the current idea does not allow someone to flood the market with 12mpg high smog wonders. All cars must meet meet minimum emissions standards. You could only sell as many as the credits you could purchase would allow. You would have to have that high profit margin to be able to purchase those credits and still make a profit.

If they said you had to sell them yourself instead of buying credits companies would just buy ZEVs from someone who makes them, slap your badge on them and sell them at a loss. It would in no way force everyone to develop or even license the technology. The thought of everyone having to sell a ZEV was one of the driving factors behind yet another of the ill conceived business ventures of Malcom Bricklin that went bankrupt the EV Warrior.

If the goal is to get a certain percentage of ZEV cars on the road, the use of credits is just as an effective method as making a mfg produce or sell them.

It is dodgy. It’s an attempt to create a synthetic “market based solution” in a situation where nobody can put environmental/climate damage onto their ledger.

As a way to put environmental/climate damage onto everyone’s books, a carbon tax would be more fair and more market-based. And, if you offset it by reducing payroll taxes, it can be 0 revenue and would stop discouraging employment while discouraging CO2 emissions.

But I said “tax” and “climate”, and those words are even more “Democrat” than the moderate healthcare market reforms that the Republicans shut the government down over. So, while I think a carbon tax (coupled with the repeal of odd policies like the carbon-emission-permit market AND a reduction in payroll taxes) would be good public policy, I’d be surprised if it ever went through.

This is quite similar to a carbon tax. A company that doesn’t build enough EVs has to pay someone else who produces more than what is necessary.

The idea of a carbon tax is that the regulators will establish a tolerable level of pollution and then allow the market to sort out how that target is met. California’s approach to EVs is virtually the same.

(Personally, I think that the state’s approach to EVs is misguided. But the trading mechanism itself isn’t the problem.)

Carb credits, from the same morons that poisoned our water with MTBE, that would rather see a forest burn than log it (like that wouldn’t pollute the air!@&*(),won’t build any new freeways, environmentally sends manufacturing jobs elsewhere due to inane laws, and while I could go on and on, it was just easier to move out of state to freedom.

+1 canddmeyer. Congrats on your escape. Now you can laugh at the latest brilliant scheme from the Sacramento Utopians. It’s always easier to build your Neverland using other people’s money. They won’t stop trying to perfect that state until they have destroyed it. Enjoy your windfall, Elon.